Payroll is no longer languishing in the wilderness with the introduction of Single Touch Payroll (STP).

For years, payroll has been languishing in the wilderness, but with the introduction of Single Touch Payroll (STP) by the Australian Taxation Office (ATO), it will finally now be front and centre.

Single Touch Payroll has moved payroll functionality from the Accounting backwaters and forever changed the way we manage and report payroll results to the Government.

Payroll is a fundamental aspect of organisational operations, critical to both employees and employers. It is as significant for a business as Accounting; however, it entails the added responsibility of being essential for the well-being and financial stability of employees.

Where did real-time reporting start?

The Single Touch Payroll journey started for me over twenty years ago. Even then, it was obvious that real-time reporting would be a necessity, not a luxury. The concern regarding privacy (big brother syndrome) is understandable but no more or less than the concern presented when the Australia Card was first proposed in 1985. The Australia Card never came to fruition (abandoned in 1987), but in principle, it was replaced by the Tax File Number (TFN).

With real-time reporting, it creates a level playing field for all employers ensuring that businesses can have far greater confidence that other employers are meeting their PAYG withholding tax and superannuation obligations.

The numerous benefits of Single Touch Payroll.

Single Touch Payroll streamlines business reporting obligations and makes it easier for employers to report to the ATO. When employers report to the ATO through Single Touch Payroll, employees can see more of their tax and super information online through myGov. These benefits provide far greater transparency for the employee, negating individual privacy concerns. STP helps ensure that employers are meeting their obligations to their employees.

Some organisations will use "scare tactics" to help sell their consultancy services in the lead-up to the introduction of STP. However, nothing within the existing STP legislative framework warrants these marketing tactics, as the ATO is taking a soft-touch approach to compliance during the Single Touch Payroll introduction period.

The biggest concern regarding payroll compliance within your business is Fair Work. Employers can now be held responsible for underpayments and other "bad payroll behaviour". They can be personally penalised with far-reaching consequences for any future business endeavours.

Complying with workplace laws is “not optional” and starts with properly trained payroll personnel closely followed by well-crafted payroll software.

Payroll has undergone a significant transformation, evolving from a once-overlooked component of Accounting into a critical pillar of business operations. With the introduction of Single Touch Payroll (STP), the importance of accurate and timely payroll management is more pronounced than ever. This shift not only streamlines the payroll process but also enhances compliance and transparency, making it an essential aspect for Businesses aiming for efficiency and accountability in their financial and employment practices.

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